Amazon has bought out AmieStreet.com, the music site popular among indie …

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Amazon has bought AmieStreet.com, the indie music site that became known for starting its song prices at zero and increasing them with each download. Amie Street, Inc. (which remains independent) said that it plans to shift its focus onto its own social music streaming service, Songza.com.

Amie Street launched in July 2006 as a bit player in the online music scene. At that time, it was one of the only services that offered DRM-free MP3s, and the pricing structure was very attractive to those looking to explore new music. Songs started out free, but as more and more people bought a particular song, the price would go up a few cents, with a cap of 99¢ per download.

Amie Street managed to build quite a library over the last four years, and even introduced a streaming Web player for its music. Although the site never quite became iTunes or Amazon MP3, it had a loyal following of users who loved the site for its social networking and music discovery features.

The news that Amazon was buying out Amie Street's online business came as a shock to some users, but it shouldn't have. Amazon has long been an investor in Amie Street, so it was only a matter of time before the media giant took over. What's more of a surprise is that Amazon is closing Amie Street's website down—in a letter to customers, the Amie Street founders told customers that they will no longer be able to use the site as of September 22, and that they should download all purchased music before then. Amazon said that active customers will receive a $5 credit to the Amazon MP3 store that will work until December 1.

So, what is Amie Street, Inc. going to do now? The company is focusing on its "new" social music service Songza. You may recognize that name, though, and that's because Songza isn't entirely new. It used to be its own music streaming service, eventually gobbled up by Amie Street in 2008.

"Since there is no way a computer-generated radio station can represent us, we built Songza to be a social music service that let users share their music, see what their friends are listening to and collaborate with new people who share their interests," Amie Street cofounder and CEO Elias Roman said in a statement.

Indeed, the focus of Songza appears to be custom-built "radio" stations where users can stream more than 8 million songs. "Where else can you find a Mad Men Tribute station, a Georgia Southern University station, and Yelp's Miami Office station?" asked Amazon. (Well, Pandora, for one...) But unlike Pandora, it seems as if users will be able to choose the songs that get played instead of simply guiding the service towards certain types of music—users can request a song or artist from a particular station and it may or may not get approved by the creator of that station, much like a real over-the-air radio station.

Songza is currently in an open beta, so it's free to check out if you're interested. Despite our disappointment at the sale of AmieStreet.com, it looks like the new and improved Songza will be fun to use among groups of friends or colleagues, the company says that the service will eventually make its way to mobile devices and set-top boxes.

(Updated at 10:55am CDT with corrections. Amie Street's online business was sold to Amazon, but the company itself remains independent. Amie Street, Inc. owns Songza.com.)

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Jacqui Cheng
Jacqui is an Editor at Large at Ars Technica, where she has spent the last eight years writing about Apple culture, gadgets, social networking, privacy, and more. Emailjacqui@arstechnica.com//Twitter@eJacqui